The Registrar of Companies v Swarbrick & Ors (Administrators of Gardenprime Ltd) [2014] EWHC 1466 (Ch)

[2014] EWHC 1466 (Ch)

Case No HC12C00705

IN THE HIGH COURT OF JUSTICE

CHANCERY DIVISION

Venue Royal Courts of Justice, Strand, London, WC2A 2LL

Date 13 May 2014

Before

RICHARD SPEARMAN Q.C.

(sitting as a Deputy Judge of the Chancery Division)

Between

THE REGISTRAR OF COMPANIESApplicant

ANGELA SWARBRICKRespondents

MAURICE MOSESRespondent

CRAIG LEWISRespondent

Daniel Margolin (instructed by the Treasury Solicitor) for Applicant

Sarah Clarke (instructed by Addleshaw Goddard LLP) for Respondents

Hearing Hearing dates: 3 April 2014

JUDGMENT

RICHARD SPEARMAN Q.C.:

Introduction

[1]This is an application by the Registrar of Companies (“the Applicant”) to set aside an Order of Deputy Registrar Garwood dated 19 August 2013 (“the Order”). The Order was made on the application of the Respondents, who are the Joint Administrators of a company called Gardenprime Limited (“the Company”), dated 18 August 2013 (“the Respondents’ Application”). It granted all the relief sought by the Respondents. The application is made under the liberty to apply contained in the Order. It comes before me pursuant to directions made on 21 January 2014 by Deputy Registrar Agnello QC.

[2]The Respondents’ Application concerned a statement of proposals for achieving the purpose of the administration (“the Proposals”) which the Respondents had sent to the Applicant pursuant to paragraph 49 of Schedule B1 to the Insolvency Act 1986 (“IA 1986”), and which the Applicant had then placed on the register.

[3]The background is that a dispute had arisen as to whether dissemination of the contents of the Proposals by making them publicly accessible placed the Company in breach of a contractual obligation to keep confidential certain information (“the Information”). The Respondents took the view that failing to deal with that dispute would prejudice the conduct of the administration, but that the dispute could be headed off if the Proposals were to be replaced on the register with amended proposals which omitted the material in dispute. Those were the Respondents’ reasons for seeking the Order.

[4]It forms no part of the Applicant’s case to suggest that the Respondents could not have complied with the IA 1986 by filing the Proposals originally in the amended form (omitting the disputed material). Nor does the Applicant contend that the Order ought not to have been made either because the confidentiality of that material had already been destroyed or because there is any particular reason why that material ought to remain on the public record. The Applicant’s central concerns are to challenge whether, and to establish the extent to which, it is open to the court to intervene in the performance of the Applicant’s duties and powers. It is in that context that the Applicant seeks to have the Order set aside, on the basis that it directed the Applicant to replace the Proposals with amended proposals, after the Respondents had sent the Proposals to the Applicant, and the Applicant had lawfully placed them on the register.

[5]In the result, the application primarily concerns questions of statutory interpretation.

[6]Daniel Margolin appeared for the Applicant and Sarah Clarke for the Respondents. Preparation for the hearing, the conduct of the hearing, and the collation of an additional bundle of authorities, were conducted with commendable efficiency and co-operation. I am grateful to both Counsel for their clear and helpful submissions.

Factual background

[7]There is no material dispute as to the facts, and they can be shortly stated:(i) The Company is an investment company with 9 secured creditors (all banks) and one unsecured creditor (HMRC).

(ii) The Respondents were appointed on 21 May 2013 by a qualifying floating charge-holder. The purpose of the administration was to realise property with a view to making a distribution to secured creditors, by means of a pre-packaged sale of shares held by the Company.

(iii) This was achieved pursuant to a share purchase agreement dated 21 May 2013 made between (1) the Company (acting by the Respondents) as Seller, (2) Canada Square Investments Limited as Buyer and (3) the Respondents (the “SPA”).

(iv) Clause 7 of the SPA imposed confidentiality obligations on the Company in relation to the Information.

(v) On 4 June 2013 the Respondents circulated to the creditors a report satisfying their obligations under Statement of Insolvency Practice 16. This contained, at least in part, either the Information or the disputed material – I draw a distinction between the two, as the Respondents do not accept that the disputed material included the Information - but no issue as to breach of confidence arose from that in light of the confidentiality obligations of the recipients.

(vi) On 11 June 2013 the Respondents sent the Proposals to (1) all known creditors and (2) the Applicant. Again, no breach of confidence issue arises as to (1).

(vii) The Buyer informed the Respondents that it objected to the inclusion of certain material in the Proposals, comprising or including information in respect of which it asserted a confidentiality obligation under Clause 7.1 of the SPA.

(viii) However, the Buyer did not seek an injunction to restrain further or continued publication of that disputed material.

(ix) Instead - it would seem with the Buyer’s instigation or concurrence - the Respondents made the Respondents’ Application seeking “the Court’s assistance to enable [the Respondents] to replace the report filed with the Amended Report” (the latter being in a form acceptable to the Buyer).

(x) In the meantime, the contents of the Proposals (including certain material to the inclusion of which the Buyer objected) were the subject of an article on the Estates Gazette’s (subscription-only) website.

The Order

[8]The Order contained definitions which I adopt in this judgment. It provided that:

“1. Pursuant to CPR Part 39.2(3)(a) the hearing be heard in private on grounds [sic] that publicity would defeat the object of the hearing. 2. Pursuant to rule 7.31A(7) Insolvency Rules 1986 (“IR 1986”), the evidence in support of this application and schedules to this order shall not be made available for inspection without the permission of the court. 3. Pursuant to rule 2.33A IR 1986 that [sic] the specified parts (identified in Schedule I to this order) of the Joint Administrators’ proposals dated 11 July 2013 (“the Proposals”)filed in accordance with paragraph 49, Schedule B1 Insolvency Act 1986 (“IA 1986”)shall not be sent to the Registrar of Companies. 4. A declaration is hereby made pursuant to s.1074 Companies Act 2006 (“CA 2006”)that, as a consequence of the order in paragraph (3) above, the Proposals, which include the Specified Parts identified in Schedule I, contain unnecessary material which cannot readily be separated from the rest of the document and that the Proposals are accordingly not treated as meeting the requirements for proper delivery. 5. The Joint Administrators shall comply with their obligations under paragraph 49(4)(a) Schedule B1 IA 1986 and [rule] 2.33A(3) IR 1986 by filing amended proposals (“the Amended Proposals”)at Schedule II to this order. 6. The Joint Administrators’ obligation to send a copy of this order to the Registrar of Companies pursuant to [rule] 2.33A(4) shall be met by the Joint Administrators sending a copy of the order but omitting Schedule I. 7. The Registrar of Companies shall exercise his power pursuant to s.1076 CA 2006 to remove the Joint Administrators’ Proposals dated 11 July 2013 from the Register and accept the Amended Proposals. 8. Time is abridged in respect of service of this application. 9. Liberty to the Registrar of Companies to apply within 14 days of the service of this order.”

[9]As indicated above, this replicated what was sought by the Respondents’ Application.

Paragraphs 1 and 2 of the Order and derogations from open justice

[10]The application before me was essentially concerned with paragraphs 3-7 of the Order.

[11]In this regard, the Applicant accepted that paragraphs 1 and 2 of the Order were both justified. While I intend no criticism of anyone, in my judgment this approach is not correct. The hearing before me was held in public, and I consider that the hearing in front of the Deputy Registrar, also, could and should have been heard in public.

[12]Any need to preserve the confidentiality of information which forms the subject of an application, and to avoid the consequence that the hearing renders nugatory the purpose for which the application is made, is generally capable of being catered for by other measures. For example: preparing witness statements with confidential exhibits; not reading out the contents of some documents; making an order under CPR 31.22(2) (so that a document is not made generally accessible by being deployed in open court); and, in the circumstances of this case, making directions as in paragraph 2 of the Order.

[13]As stated in CPR 39.2(1), the general rule is that a hearing is to be in public.

[14]Ambrosiadou v Coward [2011] EMLR 419 concerned private information which the Court of Appeal held should be protected by an injunction from being made public. Lord Neuberger MR said at [52]:

“In many cases involving alleged confidential information, one or both of the parties wish the hearing to take place in private, because of understandable concern that confidential information may be revealed in the course of the hearing. Before applying for a hearing to be in private, the parties and their advisers should consider whether such concerns can be accommodated by a less drastic course”

. Leveson LJ said at [54]: “it is almost invariably possible to conduct a hearing of this nature in public and in such a way as demonstrates adherence to the principle of open justice, while at the same time ensuring that truly confidential material is referenced on paper and does not enter the public domain. When cases of this nature arise, it is critically important that parties conducting them prepare documents (including submissions) in a way that facilitates that approach. Without being prescriptive but by way of example, this could involve placing confidential material in an annex which the court can readily identify and order not to be disclosed”.

[15]The relevant legal principles are helpfully summarised in the Practice Guidance issued by Lord Neuberger MR concerning Interim Non-Disclosure Orders at [9]-[14]:

“9. Open justice is a fundamental principle. The general rule is that hearings are carried out in, and judgments and orders, are public: see Article 6(1) of the Convention, CPR 39.2 and Scott v Scott [1913] AC 417. This applies to applications for interim non-disclosure orders: Micallef v Malta (17056/06) [2009] ECHR 1571 at [75]ff; Ntuli v Donald [2010] EWCA Civ 1276 (Ntuli) at [50]. 10. Derogations from the general principle can only be justified in exceptional circumstances, when they are strictly necessary as measures to secure the proper administration of justice. They are wholly exceptional: R v Chief Registrar of Friendly Societies, ex parte New Cross Building Society [1984] Q.B. 227 at 235; Nutuli at [52] – [53]. Derogations should, where justified, be no more than strictly necessary to achieve their purpose. 11. The grant of derogations is not a question of discretion. It is a matter of obligation and the court is under a duty to either grant the derogation or refuse it when it has applied the relevant test: AMM v HXW [2010] EWHC 2457 (QB) at [34]. 12. There is no general exception to open justice where privacy or confidentiality is in issue. Applications will only be heard in private if and to the extent that the court is satisfied that by nothing short of the exclusion of the public can justice be done. Exclusions must be no more than the minimum strictly necessary to ensure justice is done and parties are expected to consider before applying for such an exclusion whether something short of exclusion can meet their concerns, as will normally be the case: Ambrosiadou v Coward [2011] EWCA Civ 409 at [50] – [54]. Anonymity will only be granted where it is strictly necessary, and then only to that extent. 13. The burden of establishing any derogation from the general principle lies on the person seeking it. It must be established by clear and cogent evidence: Scott v Scott [1913] AC 417 at 438 – 439, 463 and 477; Lord Browne of Madingley v Associated Newspapers Ltd [2008] 1 QB 103 at [2] – [3]; Secretary of State for Home Department v AP (No2) [2010] 1 WLR 1652 at [7]; Gray v UVW [2010] EWHC 2367 at [6] – [8]; and JIH v News Group Newspapers [2011] EWCA Civ 42 (JIH) at [21]. 14. When considering the imposition of any derogation from open justice, the court will have regard to the respective and sometimes competing Convention rights of the parties as well as the general public interest in open justice and in the public reporting of court proceedings. It will also adopt procedures which seek to ensure that any ultimate vindication of Article 8 of the Convention, where that is engaged, is not undermined by the way in which the court has processed an interim application. On the other hand, the principle of open justice requires that any restrictions are the least that can be imposed consistent with the protection to which the party relying on their Article 8 Convention right is entitled. The proper approach is set out in JIH.”

[16]I think that there may be a tendency on the part of some applicants to adopt the stance that to justify holding a hearing in private it is sufficient to establish that the case falls within one of the classes in CPR 39.2(3). I have seen this, for example, in a case falling within CPR 39.2(3)(f) involving “uncontentious matters arising in the administration of trusts or in the administration of a deceased person’s estate”. In that case, I was told by Counsel that it is usual practice for applications involving such matters to be listed in private. This notwithstanding the fact that this class of case is not one of those which is to be listed by the court in private in the first instance in accordance with Practice Direction 39A.

[17]The way matters unfolded in the present case appears from the transcript below. The Applicant did not appear and was not represented. The Respondents’ Counsel submitted that a direction that the hearing should be in private “would be appropriate here because we fall within CPR Part 39.2(3)(a) on the grounds that publicity would defeat the object of the hearing”. The Deputy Registrar responded: “That seems to make logical sense to me. I thought of that entirely and I am satisfied I can do that. Therefore, I so order”.

[18]I consider that any such approach should be discouraged. The fact that the case can be brought within one of those classes does not lead to any automatic entitlement to have the hearing conducted in private. On the contrary, as is reflected in the above Practice Guidance, the court is required in every case to reach a decision, having applied the relevant test to all the facts of that particular case, as to whether or not to grant any derogation from the principle of open justice – and, generally speaking, cases in which it will be necessary for an entire hearing to be held in private are likely to be few and far between. The fact that holding the hearing in private may obviate complications in the preparation and the presentation of the application is an essentially utilitarian consideration which is insufficient to justify displacing the principle of open justice.

Legislative framework

[19]The provisions with which the present application is centrally concerned are:(i) paragraph 49 of Schedule B1 to the IA 1986 (“Paragraph 49”), which relates to the making and service of a statement by the administrator of proposals for achieving the purpose of administration;

(ii) rule 2.33 of the IR 1986 (“Rule 2.33”), which sets out the information required to be included in the statement served pursuant to Paragraph 49;

(iii) rule 2.33A of the IR 1986 (“Rule 2.33A”), which permits the court, on the application of the administrator, to limit the disclosure of specified parts of that information;

(iv) section 1074 of the CA 2006, which relates to documents delivered to the Applicant which contain “unnecessary material”; and

(v) section 1076 of the CA 2006, which relates to acceptance by the Applicant of replacements for documents not meeting the requirements for proper delivery.

[20]Paragraph 49 provides (so far as material to the present application):

“(1) The administrator of a company shall make a statement setting out proposals for achieving the purpose of administration. (2) A statement under sub-paragraph (1) must, in particular– (a) deal with such matters as may be prescribed … (4) The administrator shall send a copy of the statement of his proposals– (a) to the registrar of companies, (b) to every creditor of the company of whose claim and address he is aware, and (c) to every member of the company of whose address he is aware. (5) The administrator shall comply with sub-paragraph (4)– (a) as soon as is reasonably practicable after the company enters administration, and (b) in any event, before the end of the period of eight weeks beginning with the day on which the company enters administration … (7) An administrator commits an offence if he fails without reasonable excuse to comply with sub-paragraph (5). (8) A period specified in this paragraph may be varied …”

[21]Rule 2.33 is entitled “Administrator’s proposals” and provides (so far as material):

“(1) The administrator shall, under paragraph 49, make a statement which he shall send to the registrar of companies (2) The statement shall include, in addition to those matters set out in paragraph 49 –… (h) if a full statement of affairs is not provided, the names, addresses and debts of the creditors including details of any security held; (j) if no statement of affairs has been submitted, details of the financial position of the company at the latest practicable date (which must, unless the court otherwise orders, be a date not earlier than that on which the company entered administration), a list of the company’s creditors including their names, addresses and details of their debts, including any security held, and an explanation as to why there is no statement of affairs … (o) the manner in which the affairs and business of the company – (i) have, since the date of the administrator’s appointment, been managed and financed, including, where any assets have been disposed of, the reasons for such disposals and the terms upon which such disposals were made; and (ii) will, if the administrator’s proposals were approved, continue to be managed and financed …” (i) have, since the date of the administrator’s appointment, been managed and financed, including, where any assets have been disposed of, the reasons for such disposals and the terms upon which such disposals were made; and (ii) will, if the administrator’s proposals were approved, continue to be managed and financed …”

[22]Rule 2.33A is entitled “Limited disclosure of para 49 statement” and provides:

“(1) Where the administrator thinks that it would prejudice the conduct of the administration or might reasonably be expected to lead to violence against any person for any of the matters specified in Rule 2.33(2)(h) and (j) to be disclosed, the administrator may apply to the court for an order of limited disclosure in respect of any specified part of the statement under paragraph 49. (2) The court may, on such application, order that some or all of the specified part of the statement must not be sent to the registrar of companies or to creditors or members of the company as otherwise required by paragraph 49(4). (3) The administrator must as soon as reasonably practicable send to the persons specified in paragraph 49(4) the statement under paragraph 49 (to the extent provided by the order) and an indication of the nature of the matter in relation to which the order was made. (4) The administrator must also send a copy of the order to the registrar of companies. (5) A creditor who seeks disclosure of a part of a statement under paragraph 49 in relation to which an order has been made under this Rule may apply to the court for an order that the administrator disclose it. The application must be supported by written evidence in the form of a witness statement. (6) The applicant must give the administrator notice of the application at least 3 business days before the hearing. (7) The court may make any order for disclosure subject to any conditions as to confidentiality, duration, the scope of the order in the event of any change of circumstances, or other matters as it sees just. (8) If there is a material change in circumstances rendering the limit on disclosure or any part of it unnecessary, the administrator must, as soon as reasonably practicable after the change, apply to the court for the order or any part of it to be rescinded. (9) The administrator must, as soon as reasonably practicable after the making of an order under paragraph (8), send to the persons specified in paragraph 49(4) a copy of the statement under paragraph 49 to the extent provided by the order. (10) The provisions of CPR Part 31 do not apply to an application under this Rule.”

[23]Section 1074 is entitled “Documents containing unnecessary material” and provides: “(1) This section applies where a document delivered to the registrar contains unnecessary material. (2) “Unnecessary material” means material that—(a) is not necessary in order to comply with an obligation under any enactment, and

(b) is not specifically authorised to be delivered to the registrar. (3) For this purpose an obligation to deliver a document of a particular description, or conforming to certain requirements, is regarded as not extending to anything that is not needed for a document of that description or, as the case may be, conforming to those requirements. (4) If the unnecessary material cannot readily be separated from the rest of the document, the document is treated as not meeting the requirements for proper delivery. (5) If the unnecessary material can readily be separated from the rest of the document, the registrar may register the document either— (a) with the omission of the unnecessary material, or (b) as delivered”.

[24]Section 1076 is entitled “Replacement of document not meeting requirements for proper delivery”E+W+S+N.I. and provides:

“(1) The registrar may accept a replacement for a document previously delivered that- (a) did not comply with the requirements for proper delivery, or (b) contained unnecessary material (within the meaning of section 1074). (2) A replacement document must not be accepted unless the registrar is satisfied that it is delivered by— (a) the person by whom the original document was delivered, or (b) the company (or other body) to which the original document relates, and that it complies with the requirements for proper delivery …” and that it complies with the requirements for proper delivery …”

[25]The broader context includes the following provisions of the CA 2006:

“1080 The register (1) The registrar shall continue to keep records of– (a) the information contained in documents delivered to the registrar under any enactment, and (b) certificates issued by the registrar under any enactment. (2) The records relating to companies are referred to collectively in the Companies Acts as “the register”. (3) Information deriving from documents subject to the Directive disclosure requirements (see section 1078) that are delivered to the registrar on or after 1st January 2007 must be kept by the registrar in electronic form. (4) Subject to that, information contained in documents delivered to the registrar may be recorded and kept in any form the registrar thinks fit, provided it is possible to inspect it and produce a copy of it. This is sufficient compliance with any duty of the registrar to keep, file or register the document or to record the information contained in it. (5) The records kept by the registrar must be such that information relating to a company or other registered bodyis associated with that body, in such manner as the registrar may determine, so as to enable all the information relating to the body to be retrieved.” “1081 Annotation of the register (1) The registrar shall continue to keep records of– (a) the information contained in documents delivered to the registrar under any enactment, and (b) certificates issued by the registrar under any enactment. (2) The records relating to companies are referred to collectively in the Companies Acts as “the register”. (3) Information deriving from documents subject to the Directive disclosure requirements (see section 1078) that are delivered to the registrar on or after 1st January 2007 must be kept by the registrar in electronic form. (4) Subject to that, information contained in documents delivered to the registrar may be recorded and kept in any form the registrar thinks fit, provided it is possible to inspect it and produce a copy of it. This is sufficient compliance with any duty of the registrar to keep, file or register the document or to record the information contained in it. (5) The records kept by the registrar must be such that information relating to a company or other registered bodyis associated with that body, in such manner as the registrar may determine, so as to enable all the information relating to the body to be retrieved.” “1081 Annotation of the register (1). The registrar must place a note in the register recording— (a). the date on which a document is delivered to the registrar; (b) if a document is corrected under section 1075, the nature and date of the correction; (c) if a document is replaced (whether or not material derived from it is removed), the fact that it has been replaced and the date of delivery of the replacement; (d) if material is removed— (i) what was removed (giving a general description of its contents), (ii) under what power, and (iii) the date on which that was done; (e) if a document is rectified under section 859M, the nature and date of rectification; (f) if a document is replaced under section 859N, the fact that it has been replaced and the date of delivery of the replacement. (2) The Secretary of State may make provision by regulations— (a) authorising or requiring the registrar to annotate the register in such other circumstances as may be specified in the regulations, and (b) as to the contents of any such annotation. (3) No annotation is required in the case of a document that by virtue of section 1072(2) (documents not meeting requirements for proper delivery) is treated as not having been delivered. (4) A note may be removed if it no longer serves any useful purpose. (5) Any duty or power of the registrar with respect to annotation of the register is subject to the court's power under section 1097 (powers of court on ordering removal of material from the register) to direct— (a) that a note be removed from the register, or (b) that no note shall be made of the removal of material that is the subject of the court’s order. (6) Notes placed in the register in accordance with subsection (1), or in pursuance of regulations under subsection (2), are part of the register for all purposes of the Companies Acts. (7) Regulations under this section are subject to negative resolution procedure.” “1094 Administrative removal of material from the register (1) The registrar may remove from the register anything that there was power, but no duty, to include. (2) This power is exercisable, in particular, so as to remove— (a) unnecessary material within the meaning of section 1074, and (b) material derived from a document that has been replaced under— section 1076 (replacement of document not meeting requirements for proper delivery), or section 1093 (notice to remedy inconsistency on the register). (3). This section does not authorise the removal from the register of— (a) anything whose registration has had legal consequences in relation to the company as regards— (i) its formation, (ii) a change of name, (iii) its re-registration, (iv) its becoming or ceasing to be a community interest company, (v) a reduction of capital, (vi) a change of registered office, (vii) the registration of a charge, or (viii) its dissolution; (b) an address that is a person’s registered address for the purposes of section 1140 (service of documents on directors, secretaries and others). (4) On or before removing any material under this section (otherwise than at the request of the company) the registrar must give notice— (a) to the person by whom the material was delivered (if the identity, and name and address of that person are known), or (b) to the company to which the material relates (if notice cannot be given under paragraph (a) and the identity of that company is known). (5) The notice must— (a) state what material the registrar proposes to remove, or has removed, and on what grounds, and (b) state the date on which it is issued.” “1095 Rectification of register on application to registrar (1) The Secretary of State may make provision by regulations requiring the registrar, on application, to remove from the register material of a description specified in the regulations that— (a) derives from anything invalid or ineffective or that was done without the authority of the company, or (b) is factually inaccurate, or is derived from something that is factually inaccurate or forged. (2) The regulations may make provision as to— (a) who may make an application, (b) the information to be included in and documents to accompany an application, (c) the notice to be given of an application and of its outcome, (d) a period in which objections to an application may be made, and (e) how an application is to be determined. (3) An application must— (a) specify what is to be removed from the register and indicate where on the register it is, and (b) be accompanied by a statement that the material specified in the application complies with this section and the regulations. (4) If no objections are made to the application, the registrar may accept the statement as sufficient evidence that the material specified in the application should be removed from the register. (5) Where anything is removed from the register under this section the registration of which had legal consequences as mentioned in section 1094(3), any person appearing to the court to have a sufficient interest may apply to the court for such consequential orders as appear just with respect to the legal effect (if any) to be accorded to the material by virtue of its having appeared on the register. (6) Regulations under this section are subject to affirmative resolution procedure.” “1096 Rectification of the register under court order (1). The registrar shall remove from the register any material— (a) that derives from anything that the court has declared to be invalid or ineffective, or to have been done without the authority of the company, or (b) that a court declares to be factually inaccurate, or to be derived from something that is factually inaccurate, or forged, and that the court directs should be removed from the register. (2) The court order must specify what is to be removed from the register and indicate where on the register it is. (3) The court must not make an order for the removal from the register of anything the registration of which had legal consequences as mentioned in section 1094(3) unless satisfied— (a) that the presence of the material on the register has caused, or may cause, damage to the company, and (b) that the company’s interest in removing the material outweighs any interest of other persons in the material continuing to appear on the register. (4) Where in such a case the court does make an order for removal, it may make such consequential orders as appear just with respect to the legal effect (if any) to be accorded to the material by virtue of its having appeared on the register. (5) A copy of the court’s order must be sent to the registrar for registration. (6) This section does not apply where the court has other, specific, powers to deal with the matter, for example under— (a) the provisions of Part 15 relating to the revision of defective accounts and reports, or (b) section 859M (rectification of register).”

The decision of the Deputy Registrar

[26]The Respondents’ Application was made on short notice to the Applicant, who took no part in the hearing, and did not file either evidence or submissions in opposition. The Respondents’ arguments before the Deputy Registrar contained the following steps:(i) They conceded that section 1095 of the CA 2006 was not applicable.

(ii) They contended that the disputed material comprised matters within the ambit of Rule 2.33A(1), and that disclosure of that material by placing it on the register would prejudice the conduct of the administration.

(iii) While they accepted that an application under Rule 2.33A would ordinarily be made before a statement was sent to the Applicant in compliance with Paragraph 49(4), they argued that it was permissible to make an application retrospectively.

(iv) They also contended that: (1) the Proposals contained “unnecessary material” within the meaning of section 1074(2) of the CA 2006, (2) this “unnecessary material” could not readily be separated from the rest of the Proposals, and (3) accordingly, pursuant to section 1074(4) of the CA 2006, the Proposals should be treated as not meeting the requirements for proper delivery.

(v) They argued that the court had jurisdiction to direct the Applicant how to exercise the Applicant’s statutory duties and powers.

(vi) Accordingly, they submitted that the court could and should direct the Applicant to exercise the power contained in section 1076 of the CA 2006 by accepting the Amended Proposals as a replacement for the Proposals.

[27]The Deputy Registrar did not give a reasoned judgment. However, it is apparent from the transcript of the hearing, and the terms of the Order, that he accepted these submissions.

Applicant’s submissions

[28]Mr Margolin made a number of general submissions:(i) The Applicant is a creature of statute (see sections 1060-1061 of the CA 2006).

(ii) The Applicant’s functions and powers are set out in, and are governed by, statute (currently, the CA 2006, Part 35).

(iii) A helpful summary of the Applicant’s role is to be found in Re Globespan Airways Ltd

[2012] EWCA Civ 1159

at [18]-[23]. As noted in those paragraphs, the information maintained by the Applicant is known as “the register”.

(iv) In accordance with section 1080 of the CA 2006, the Applicant is under a duty to keep records of the information contained in documents delivered to him under any enactment (which would embrace the Proposals in the present case).

(v) As the sections quoted above reflect, the CA 2006 introduced a new, and detailed, statutory regime in relation to the amendment and replacement of documents delivered to the Applicant and the rectification of material on the register.

(vi) The court’s extra-statutory jurisdiction over the Applicant is extremely limited: (1) the Applicant is “subject to public law duties” (Re Globespan Airways Ltd, Arden LJ at [22]) such that the performance of his functions is susceptible to judicial review in accordance with ordinary public law principles, (2) beyond that, however, the court does not possess any “inherent jurisdiction” over the Applicant’s performance of his duties, (3) the fact that, by contrast with previous legislation, the CA 2006 contains a detailed statutory code relating to the removal of material from the register makes the existence of a parallel non-statutory jurisdiction to require the Applicant to remove material from the register even more unlikely. Reference was made to Re Calmex Ltd

[1989] 1 All ER 485

, Igroup Ltd v Ocwen

[2004] 1 WLR 451

, and Re a Company (No. 007466 of 2003) (also known as Re a Company (No. 1389920))

[2004] 1 WLR 1357

and(with regard to point (3) above) to Exeter Trust Ltd v Screenways Ltd

[1991] BCLC 888

(CA) at 894-895. I will return to these authorities below.

(vii) In the present case, the Applicant’s acceptance and retention of the Proposals in compliance with his duty to do so under section 1080(1) of the CA 2006 could not be criticised in terms of ordinary public law principles.

(viii) The court does not have “general and unlimited inherent jurisdiction to supervise the registrar”. The court’s inherent jurisdiction is limited to preventing abuse of its own process (see Bhamjee v Forsdick

[2004] 1 WLR 88

, CA at [11]-[15]).

(ix) It appears from the transcript of the hearing before the Deputy Registrar that (1) a distinction was drawn both by Counsel for the Respondents and by the court between the performance of the Applicant’s duties and the exercise of the Applicant’s (discretionary) powers, and (2) both Counsel and the court were of the view that whereas it was open to the Court to order the Applicant to exercise a statutory discretion in a particular way, it could not otherwise interfere with the performance by the Applicant of a duty imposed on him by statute.

(x) Even if this was a valid distinction, which it is not, the decided cases provide no authority for saying that the court can tell the Applicant to exercise a discretion which Parliament has conferred on him (and not on the court) in a particular way in the absence of some identifiable (public law) basis for such intervention.

(xi) Moreover, in the present case there is no suggestion that the Applicant has not performed his duties properly, including the duty imposed by section 1080 of the CA 2006 to keep the Proposals on the register.

(xii) Although the Buyer (who, as the person to whom the material obligations of confidentiality were owed, would be the proper person to do this) had not chosen to seek an injunction, even if the Applicant’s submissions concerning the provisions rehearsed in the Order were correct, the Buyer would not necessarily be left without a remedy in circumstances where a document containing confidential information had, unlawfully, been delivered to the Applicant and been placed on the register. Reference was made to Fraser v Evans

[1969] 1 QB 349

, Malone v Metropolitan Police Commissioner

[1979] Ch 344

, Attorney-General v Newspaper Publishing plc

[1988] Ch 333

, Campbell v MGN Ltd

[2004] 2 AC 457

, and Ambrosiadou v Coward [2011] EMLR 419.

[29]Mr Margolin made the following submissions concerning specific statutory provisions.

[30]First, the disputed material does not “derive from anything invalid or ineffective or that was done without the authority of the company”. Nor is it “factually inaccurate” or “derived from something that is factually inaccurate or forged”. Moreover, section 1095 of the CA 2006 could not, in any event, have been invoked since it has no application to an administrators’ statement, because such a statement is not a “relevant company form” within the meaning of paragraph 4(3) of the Registrar of Companies and Applications for Striking Off Regulations 2009, SI 2009/1803. The Respondents were therefore correct to accept that the statutory scheme for rectification of the register under sections 1095 and 1096 of the CA 2006 was and is of no application on the facts of the present case.

[31]Second, if the court is satisfied as to one or both of the criteria laid down in Rule 2.33A(1) it may, in the exercise of its discretion, “order that some or all of the specified part of the statement must not be sent to the registrar of companies or to creditors or members of the company as otherwise required by paragraph 49(4)”. In light of the language of that Rule, however, the court’s power to order that the statement “must not be sent” did not apply to the situation where, as had happened in the present case, the statement had already been sent to the Applicant (and, for that matter, to creditors).

[32]Third, and in any event, in this case the court had no basis for declaring that the Proposals contained “unnecessary material” within the meaning of section 1074(2) of the CA 2006:(i) sub-sections 1074(2)(a) and (b) of the CA 2006 contain requirements which are cumulative rather than alternative;

(ii) as to the first requirement, it will ordinarily be impossible to say, in relation to a “free format” document such as the Proposals (as distinct from a standard form document containing boxes to be “populated”), that a particular passage “is not necessary in order to comply with an obligation under any enactment”;

(iii) in connection with that submission, which is predicated on the premise that the Applicant’s perception is integral to the operation of section 1074, Mr Margolin referred to the following statement in the current version of the Companies House publication entitled “Registrar’s rules and powers” (emphasis added): “Often information cannot be removed as it does not meet both parts of the definition. A common example is where a small company is entitled to deliver abbreviated statutory accounts to the registrar but includes information usually found in full statutory accounts within the delivered document. In this case the second part of the definition may be met because the additional information was included by mistake, and not specifically authorised to be delivered. However, the freedom to include such information in statutory accounts will often mean that the first part of the definition will not be met. The registrar could not know at the time of delivery that the additional information is not intended to satisfy the statutory obligation to deliver a copy of the approved accounts.”

(iv) as to the second requirement, it could not be said that the disputed material was “not specifically authorised to be delivered to the registrar”;

(v) in that regard, Mr Margolin submitted that (1) what section 1074(2)(b) requires is that when the document was delivered to the Applicant it contained material which was not specifically authorised to be included by the person responsible for delivering the document to the Applicant and (2) in the present case, there is no evidence that the Proposals were not so authorised in their entirety.

[33]Fourth, although paragraph 7 of the Order requires the Applicant to exercise his power under section 1076 of the CA 2006 to remove the Proposals from the Register and accept the Amended Proposals:(i) the Applicant’s power under section 1076 to “accept a replacement for a document previously delivered” only arises where the document previously delivered “(a) did not comply with the requirements for proper delivery” or “(b) contained unnecessary material (within the meaning of section 1074)”;

(ii) when the Proposals were delivered they did not contain “unnecessary material”, for the reasons given above;

(iii) the Proposals therefore also do not fall to be “treated as not meeting the requirements for proper delivery” pursuant to section 1074(4); and

(iv) accordingly, the Applicant has no power under section 1076 to accept the Amended Proposals as a replacement for the Proposals and cannot be required to do so.

Respondents’ submissions

[34]Ms Clarke repeated and amplified the submissions she had made to the Deputy Registrar.

[35]Ms Clarke began by submitting that:(i) The primary issue for determination is whether the court was entitled to make the declarations and orders contained in paragraph 3, 4 and 7 of the Order (it being common ground that paragraphs 5 and 6 follow from paragraph 3).

(ii) This requires the court to consider whether the removal of the disputed material (a result which the Respondents say was desirable, and the Applicant does not suggest would have prejudiced anyone) could have been achieved any other way.

(iii) It is common ground that: (1) the Applicant is under a statutory duty to keep records of the information contained in documents delivered to him under any enactment, including proposals delivered pursuant to Paragraph 49; (2) this duty is subject to limited statutory exceptions contained in sections 1074, 1075, 1076, 1081, 1094, 1095 and 1096 of the CA 2006, which permit the amendment, replacement, rectification and annotation of the material contained on the register in certain circumstances, and (3) the statutory scheme for rectification under sections 1095 and 1096 did not, and does not, apply on the facts of this case.

(iv) The statutory scheme set out in the CA 2006 does not entitle the Applicant to remove material contained in a document delivered to him on grounds that placing the material on the register is likely to cause damage, for example because it contains confidential information or is defamatory.

(v) The solution suggested by the Applicant, namely that a party likely to suffer damage might be able to obtain an injunction, does not work: (1) the breach of confidence authorities cited by the Applicant are not in point, because they do not deal with a situation where the recipient of the confidential information was subject to a statutory obligation to publish that material once it had been delivered, (2) where a common law right conflicts with a statutory duty, it is the statutory duty which prevails, extinguishing the right to a remedy at common law (see Managers of the Metropolitan Asylum District v Frederick Hill and Others, Executors, & C. William Lund and Alfred Fripp

(1881) 6 App Cas 193

at 203); (3) if the effect of the provisions in the CA 2006 is that the Applicant cannot lawfully remove the Proposals or the disputed material from the register, he cannot be compelled to take such action by way of an injunction.

[36]In support of the terms of the Order, Ms Clarke submitted that:(i) A workable solution is to be found in section 1074 of the CA 2006, which deals with documents delivered to the Applicant which contain “unnecessary material”. The Applicant has a general power to remove unnecessary material (section 1094(2)(a), subject to the exceptions in section 1094(3)), further or alternatively to replace unnecessary material (section 1076(1)), without a court order.

(ii) Furthermore, where the unnecessary material cannot readily be separated from the rest of the document, the document is treated as “not meeting the requirements for delivery” (section 1074(4)), with the consequence that the Applicant’s statutory duty to keep a record of the document would not apply.

(iii) The first requirement for “unnecessary material” contained in section 1074(2), namely that the material “(a) is not necessary in order to comply with an obligation under any enactment”, can be easily determined by reference to the applicable statutory filing requirements, which will rarely require the delivery of material which (for example) contains confidential information or is defamatory, so that such material will often meet that requirement.

(iv) As to the second requirement for “unnecessary material” contained in section 1074(2), namely that the material “(b) is not specifically authorised to be delivered to the registrar”, this provision does not concern authorisation by a person, but authorisation by a statutory provision: (1) this is consistent with the wording of section 1072(2) of the CA 2006 which (in the context of a provision relating to requirements for proper delivery of documents to the Applicant) refers to “the provision requiring or authorising it to be delivered”, (2) section 1074(2)(b) makes more sense as a companion to section 1074(2)(a) if both relate to statutory provisions (section 1074(2)(a) concerns information required by an enactment and section 1074(2)(b) concerns optional information which a statute has expressly envisaged might be included), (3) in the context of the statutory scheme it is more likely that Parliament intended the Applicant should be familiar with relevant statutory provisions than that he should be required to conduct factual enquiries into the authority of the person delivering information to him, and (4) the alternative is a definition which lacks clarity and certainty, because if “specifically authorised” relates to the authority of a person to authorise that delivery, how is the identity of that person and the existence of the requisite authority to be ascertained? (vi) The disputed material was included in the Proposals as part of the details provided by the Respondents in compliance with Rule 2.33(2)(j), further or alternatively Rule 2.33(2)(o), and “Arguably [it] exceeded the information necessary to satisfy those statutory requirements, but in order to resolve any doubt an application was made to the court for relief under [Rule 2.33A], which was granted as reflected in paragraph 3 of the Order”. (vii) The Applicant’s contention that the court’s power to order that a statement “must not be sent” is not applicable where the statement has alreadybeen sent involves an unnecessarily narrow interpretation of Rule 2.33A: (1) administrations, like other forms of insolvency procedure are subject to the general control of the court (Donaldson v O’Sullivan

[2008] EWCA Civ 879

), (2) the purpose of Rule 2.33A is to allow the court to grant exemption from the requirement to disclose certain information where the provision of that information would prejudice the conduct of the administration or lead to violence against any person, (3) Rule 2.33A does not expressly require that an application for relief must be made before the proposals are sent to the Applicant, (4) there may be many circumstances in which it is desirable to grant relief after proposals are sent, for example, where such relief is required to facilitate the removal from the register of the name and address of an individual exposed to the risk of violence, and (5) although aspects of the language of Rule 2.33A perhaps reflect an assumption that an application will ordinarily be made before the proposals are sent, there is no reason exclude the possibility of granting such relief thereafter. (viii) The consequence of the relief under Rule 2.33A contained in paragraph 3 of the Order, is that: (1) to the extent that the disputed material was ever required to be included in the Proposals “in order to comply with an obligation under any enactment”, or was specifically authorised by an enactment to be included in the Proposals, it ceased to be so, and (2) as a result, it became “unnecessary material” within the meaning of section 1074(2) of the CA 2006. (ix) In this regard, the Applicant’s contention that section 1074 (2)(b) requires that the document was not “specifically authorised to be delivered” by the person responsible for delivering the document to the Applicant at the time when it was delivered is incorrect: (1) as set out above, “specifically authorised” concerns authorisation under statutory provisions, (2) although the question of whether material is unnecessary will usually be considered at the time that the material is delivered, the CA 2006 does not require that the point may only be considered at that time, and (3) where, as in the present case, material is brought within the meaning of section 1074 by a later order of the court, there is no reason why the Applicant should be prevented from exercising his powers in relation to unnecessary material at that stage. (x) As to paragraph 7 of the Order, the requirements of section 1076 were satisfied because: (1) the document contained “unnecessary material” (namely the disputed material) for the reasons stated above, (2) that unnecessary material was not capable of being readily separated from the rest of the Proposals, and (3) the Proposals were accordingly to be treated as not meeting the requirements for proper delivery. (xi) Although it was accepted at the outset of the hearing before the Deputy Registrar that the Applicant was at that stage subject to a statutory duty to keep the Proposals on the register: (1) as a consequence of paragraphs 3 and 4 of the Order, the Proposals ceased to be a document “delivered to the registrar under an enactment” and accordingly ceased to be a document the Applicant was under a duty to keep, whether under section 1080 of the CA 2006 or otherwise, and (2) in these circumstances, the court was entitled, in the exercise of its limited supervisory jurisdiction as identified in Re Calmex

[1989] 1 All ER 485

to direct that the Proposals be removed from the register. (xii) If and to the extent that the court does not have jurisdiction to direct the Applicant to accept the Amended Proposals under section 1076 of the CA 2006, the Applicant was in any event obliged to accept those proposals upon delivery: (1) although paragraph 49(5) requires an administrator to send his proposals to the registrar within 8 weeks, it does not provide that the Applicant shall not accept proposals filed later than 8 weeks, and (2) it follows that the Amended Proposals fall within the Applicant’s duty under section 1080 of the CA 2006.

[37]Ms Clarke lodged supplemental submissions in support of the Respondents’ case that the wording of Rule 2.33A does not preclude an application being made retrospectively.

[38]First, Ms Clarke referred me to:(i) paragraph 13(2) of Schedule B1 to the IA 1986, which provides that “An appointment of an administrator by administration order takes effect - (a) at a time appointed by the order, or (b) where no time is appointed by the order, when the order is made”; and

(ii) Re G-Tech Construction Ltd

[2007] BPIR 1275

, in which it was held that the court could specify a date in the past as the date upon which the appointment of an administrator took effect.

[39]In answer to that, Mr Margolin submitted that:(i) paragraph 13(2) of Schedule B1 to the IA 1986 expressly permits the court to appoint a time at which the order may take effect, without specifying that such time must be after the order is made; and

(ii) in any event, the issue in the present case is not so much when an order under Rule 2.33A takes effect, but whether on its true construction the meaning of “must not be sent” in Rule 2.33A includes “should not have been sent”.

[40]Second, on the topic of retrospective leave to commence proceedings against insolvents, Ms Clarke referred me to:(i) Sections 130(2) and 285(3)(b) of, and paragraph 43(6) of Schedule B1 to, the IA 1986, which provide that: (1) following a winding up order “no action or proceeding shall be proceeded with or commenced against the company or its property, except by leave of the court”; (2) following a bankruptcy order no bankruptcy creditor may “commence any action or other legal proceedings against the bankrupt except with the leave of the court”, and (3) where a company is in administration “No legal process (including legal proceedings…) may be instituted or continued against the company or property of the company except- (a) with the consent of the administrator or (b) with the permission of the court”.

(ii) Re Saunders (a Bankrupt), Bristol & West Building Society v Saunders

[1997] Ch 60

(in which the court recognised that leave under sections 130(2) and 285(3) could be granted retrospectively), Re Taylor

[2007] 1 Ch 150

(in which Re Saunderswas not followed, and the court refused to grant retrospective leave under section 285(3)), Godfrey v Torpy and Others (No 2)

[2007] BPIR 1538

(in which Mr Peter Leaver QC, sitting as a Deputy Judge of the Chancery Division, preferred Re Saunders and held that the court could grant retrospective leave to commence proceedings under section 424 of the IA 1986), Bank of Scotland plc v Breytenbach

[2012] BPIR 1

(in which Chief Registrar Baister followed Re Saunders and granted retrospective leave under section 285(3)), and Bank of Ireland v Colliers International UK plc

[2012] BPIR 1099

(in which David Richards J followed Re Saundersand granted retrospective leave under paragraph 43(6) of Schedule B1).

[41]Mr Margolin did not make any observations on these authorities.

Applicant’s further submissions

[42]Mr Margolin served a Skeleton Argument in reply to Ms Clarke’s primary submissions, and he also lodged a further supplementary bundle of authorities. However, I consider that there is no need to rehearse these matters in this part of this judgment.

Paragraph 3 of the Order and Rules 2.33 and 2.33A

[43]I consider that a convenient starting point is Rule 2.33A. The genesis of this Rule was not explored before me, but it is self-evident from its wording that is tightly focussed:(i) First, it only applies to certain specified matters which are required to be included in a Paragraph 49 statement, that is to say: (1) if a full statement of affairs is not provided, it applies to “the names, addresses and debts of the creditors including details of any security held”, and (2) if no statement of affairs has been submitted, it applies to “details of the financial position of the company at the latest practicable date … a list of the company’s creditors including their names, addresses and details of their debts, including any security held, and an explanation as to why there is no statement of affairs …”.

(ii) Second, it only applies where the administrator thinks that unlimited disclosure of any of those matters either (1) would prejudice the conduct of the administration or (2) might reasonably be expected to lead to violence against any person.

(iii) Third, but only where those criteria are satisfied, it confers a right on the administrator to apply to the court for an order of limited disclosure “in respect of any specified part of the statement under paragraph 49”. I would interpret the expression “any specified part” as applying to the matters specified in Rule 2.33(2)(h) and (j), and not more widely. In other words, I do not consider that once one or both of those criteria is or are satisfied there is an unlimited power to limit disclosure in the statement. That result would seem to me to lack either rhyme or reason. For example, if it can be shown that disclosure of the names and addresses of creditors of the company would be likely to lead to violence against any person, I do not see why that should have the consequence that the administrator should be entitled to ask the court, or that the court should have power to order, that there is no need to comply with the requirement to include in the statement information as to the manner in which the affairs and business of the company have been managed and financed and will be managed and financed.

(iv) Fourth, it confers no entitlement to an order that the specified part of the statement must not be sent to the Applicant or to creditors or members of the company as otherwise required by Paragraph 49(4), but instead makes clear that the grant and ambit of any such order are matters for the discretion of the court – in which context, the court can be expected to have regard to all the circumstances, including the likely harm that will result from granting or refusing relief, the balance of justice as between all affected parties, any material Convention rights, and any delay that has occurred in seeking relief.

(v) Fifth, it contains provisions which enable any creditor who seeks disclosure of a part of a statement under Paragraph 49 in relation to which an order has been made to apply to the court for an order that the administrator disclose it.

(vi) Sixth, it provides that if there is any material change in circumstances rendering the limit on disclosure or any part of it unnecessary, the administrator must, as soon as reasonably practicable, apply for the order (or part) to be rescinded.

[44]The explanation for the threshold requirement that, in the view of the administrator, unlimited disclosure of information “would prejudice the conduct of the administration” is readily understandable. That is, of course, the reason relied upon by the Respondents in the present case, the factual validity of which is not disputed by the Applicant.

[45]The explanation for the threshold requirement that, in the view of the administrator, unlimited disclosure of information “might reasonably be expected to lead to violence against any person” is no less understandable. In my judgment, however, the implications of that requirement are more complex. The reason for this is that it immediately brings to mind human rights considerations, and not least the right to respect for private and family life which is guaranteed by

Art 8 of the European Convention on Human Rights

and Fundamental Freedoms. That is especially so when it is read in conjunction with the type of information to which it applies, which includes names and addresses of individuals.

[46]It is sufficient for present purposes to refer to Green Corns Ltd v Claverley Group Ltd [2005] EMLR 748. In that case a company which provided care for troubled children in houses within a local community applied for an injunction to restrain the publication by a local newspaper of the addresses of those houses (at least some of which were in the public domain to the extent that the addresses could be ascertained by making searches at HM Land Registry). The background is that there had been a number of protests against the company’s operations, involving properties being attacked and damaged, and the children and their carers being disturbed or driven out. The company argued that these were caused or contributed to by previous publications, and that further publications would lead to repeat episodes. The application succeeded. Tugendhat J said:

“[53] There is no doubt that the home address of an individual is information the disclosure and use of which that individual has a right to control in accordance with Art 8. See R (Robertson) v Wakefield MDC [2001] EWHC Admin 915; [2002] QB 1052 [29]-[34] and R (Robertson) v Secretary of State for Home Department [2003] EWHC 1760. The first of those cases (as Maurice Kay J summarised it in the second) concerned the use of information on electoral registers. Maurice Kay J held that the practice of selling the electoral register for direct marketing purposes without affording an individual elector a right of objection was a disproportionate interference with the individual’s right to respect for private life under Article 8 of the ECHR … [56] There is nothing new about the recognition of the sensitivity of addresses. The risks associated with disclosure of personal addresses have long been recognised. See for example R v Felixstowe Justices ex p Leigh [1987] QB 582, 595D (entitlement of magistrates to protect their privacy by withholding disclosure of their addresses) and Venables v News Group Newspapers [2001] Fam 430; Mills v News Group Ltd [2001] EMLR 957 paras 26-27 (jurisdiction to restrain publication as a breach of confidence ).”

[47]Art 8 is a Convention right within the meaning of the Human Rights Act 1998 (“HRA”). Pursuant to section 6 of the HRA, therefore, the court, as a public authority, is required not to act incompatibly with that right. In my judgment, this applies on an application under Rule 2.33A just as it does in any other context. Moreover, the Applicant, as another public authority, is under the same statutory duty – a point to which I will return below.

[48]Section 3(1) of the HRA requires that “So far as possible, primary legislation and subordinate legislation must be read and given effect in a way which is compatible with human rights”. As held by the House of Lords in Ghaidan v Godin-Mendoza

[2004] 2 AC 557

, this is (in the words of Lord Nicholls of Birkenhead at [30]) an interpretative obligation of “an unusual and far-reaching character” which “may require a court to depart from the unambiguous meaning the legislation would otherwise bear”.

[49]In Campbell v MGN Ltd

[2003] QB 633

the Court of Appeal was concerned with the familiar exercise of striking a balance between different Convention rights. One of the issues before that court concerned the exemption for the special purposes (in that case, of journalism) contained in section 32 of the Data Protection Act 1998, which provides (among other things): “Personal data which are processed only for the special purposes are exempt from any provision to which this subsection relates if(a) the processing is undertaken with a view to the publication by any person of any journalistic, literary or artistic material,

(b) the data controller reasonably believes that, having regard in particular to the special importance of the public interest in freedom of expression, publication would be in the public interest, and

(c) the data controller reasonably believes that, in all the circumstances, compliance with that provision is incompatible with the special purposes”.

[50]At first instance, Morland J accepted that, in light of wording such as “with a view to publication”, that section dealt only with pre-publication processing. The Court of Appeal reached a different conclusion. That aspect of the decision of the Court of Appeal was not disturbed on appeal to the House of Lords. Lord Phillips MR said at [118]-[120]:

“If [subsections (1) to (3)] apply only up to the moment of publication it is impossible to see what purpose they serve, for the data controller will be able to obtain a stay of any proceedings under the provisions of sub-sections (4) and (5) without the need to demonstrate compliance with the conditions to which the exemption in subsections (1) to (3) is subject … Furthermore, it would seem totally illogical to exempt the data controller from the obligation, prior to publication, to comply with provisions which he reasonably believes are incompatible with journalism, but to leave him exposed to a claim for compensation under section 13 the moment that the data have been published.”

[51]In my judgment, the following factors are pertinent when interpreting Rule 2.33A:(i) the consequence that unlimited disclosure of the matters set out in Rule 2.33(2)(h) and (j) will either result in prejudice to the conduct of the administration or will lead to violence against a person may arise just as much after a Paragraph 49 statement has been sent as before it is sent - as illustrated by the present case;

(ii) both of those types of consequence are potentially serious;

(iii) because one of those types of consequence may well, and on the face of it probably will, engage Art 8 rights, Rule 2.33A should be read and given effect in a way which is compatible with those rights;

(iv) this would justify the court departing from the meaning which Rule 2.33A would otherwise bear even if the wording of the Rule was unambiguous;

(v) the wording of Rule 2.33A is not unambiguous, however, and is capable of being read so as to enable an application and an order to be made retrospectively;

(vi) the exercise is similar to that which arose in Campbell (where processing “with a view to publication” was construed as including processing by publication), and while the case is not a strong as Campbell, because Rule 2.33A will clearly serve a considerable purpose even if it is not construed in that way, it is not easy to see why it should be read so restrictively that the court is deprived of jurisdiction the instant a Paragraph 49 statement is sent, no matter how serious the consequences for anyone of subsequent disclosure of matters within the ambit of the Rule;

(vii) if Rule 2.33A ought to be read and given effect in one way in light of Art 8 considerations (and I add that any additional or countervailing Convention rights, such as the Art 1 First Protocol right to protection of property or the Art 10 right to freedom of expression can, in my judgment, readily be accommodated by reading the Rule as indicated above) that determines its proper interpretation;

(viii) whether or not (as discussed below) there are other means of obtaining the like relief against the Applicant does not affect the outcome: on the one hand, if no other form of relief is available, that serves to reinforce the points made above; on the other, if, after a Paragraph 49 statement has been sent to him, the Applicant can be required by other means to accept a statement that contains limited disclosure of the matters set out in Rule 2.33(2)(h) and (j), to construe Rule 2.33A so as to enable the same result to be achieved under that Rule has little effect on his position and makes good sense in light of the tightly drawn terms of that Rule.

[52]Having regard to these considerations, in my judgment on the correct construction of Rule 2.33A the jurisdiction of the court to make an order limiting disclosure of the specified part of the statement as otherwise required by Paragraph 49(4) is not exhausted the moment the statement has been sent. On the contrary, an application for such an order may be made even after that event, and an order may be made with retrospective effect.

[53]In the present case, I was not taken to any evidence which related the disputed material to the matters set out in Rule 2.33(2)(h) and (j). Further, Ms Clarke’s submission that the disputed material was included in the Proposals as part of the details provided by the Respondents in compliance not only with Rule 2.33(2)(j) but also or alternatively with Rule 2.33(2)(o) raised the possibility that the relief sought was not within Rule 2.33A. If my understanding is correct, however, Mr Margolin took no point on these matters. If, contrary to that understanding, they are in issue, I will hear further submissions on them.

[54]In my judgment, once an order is properly made by the court under Rule 2.33A, and is served on the Applicant, he is required to comply with it. By “properly made”, I mean an order that is not susceptible to being set aside, whether on grounds of the merits, the jurisdiction to make the order, the exercise of the court’s discretion, or any other basis.

[55]If the effect of an order is to require the Applicant to act contrary to a statutory duty, or to do something that he has no power to do, I would regard it as an order that ought not to have been made and therefore as susceptible to being set aside. I do not believe that there was any difference between Mr Margolin and Ms Clarke on this point. Ms Clarke’s arguments based on the Managers of the Metropolitan Asylum District case seem to me logically to apply to an order under Rule 2.33A as much as they do to an injunction in support of a common law right: if the effect of the provisions in the CA 2006 is that the Applicant cannot lawfully remove material from the register, he cannot be compelled to take such action by an order under Rule 2.33A any more than he can by an injunction. Mr Margolin disputed that this case was authority for the proposition that Ms Clarke sought to extract from it. However, he relied on Halifax plc v Halifax Repossessions Ltd

[2004] BCC 281

as authority for the proposition that the court has no power to order the Applicant to do something that is outside the functions conferred on him by statute.

[56]Typically, an order under Rule 2.33A will be made before the statement is sent to the Applicant. In that case, so long as the order remains in force, the Applicant will be obliged to deal with the statement as if it contained the matters set out in Paragraph 49 and Rule 2.33(2), even though, in light of the order of the court, it does not do so.

[57]I see no reason why the Applicant should not equally be bound by an order under Rule 2.33A if it is not made until after the statement has been sent to him. This does not impugn his conduct in placing the statement on the register, but merely means that henceforth he satisfies his duties by placing a redacted version on the register. If necessary, I would hold that the effect of such an order being made after a Paragraph 49 statement has been sent to the Applicant is that, for purposes of section 1080 of the CA 2006, the original statement is no longer properly regarded as a document “delivered to the registrar under any enactment” and is replaced for those purposes by the redacted version. Accordingly, the Applicant is not in breach of duty by complying with the order.

[58]If I am wrong in saying that the Applicant is required to comply with an order that has properly been made under Rule 2.33A, I would nevertheless expect him to do so without the need for further recourse to the court. However, if, to get the Applicant to comply, it were necessary to seek relief against him by way of judicial review or according to ordinary public law principles, I consider that it should be possible to rely on traditional public law grounds of illegality, irrationality, and, it may be, proportionality. To take the present case by way of example: the Applicant accepts that the disputed material need never have been sent to him or placed on the register at all, and he does not contend that the court was wrong to hold that its retention on the register would prejudice the conduct of the administration. If the Applicant chooses not to give effect to the Order when to do so would not place him in breach of any statutory duty and when he has power to do so, on what basis can he contend that he is acting legally, rationally and proportionately?

[59]I see no difficulty in reconciling compliance with such an order with the Applicant’s duties under the CA 2006. In particular, if appropriate, the Applicant will be able to place a note on the register in compliance with sections 1081(1)(c) and (d) of the CA 2006. That will enable him to preserve the integrity of the register as a record of historical events, while at the same time not allowing a desire to avoid falsifying history to take precedence over the prejudice that would result from not complying with the order.

[60]I also note that section 1096(6) of the CA 2006 provides that “This section does not apply where the court has other, specific, powers to deal with the matter”. There is therefore no difficulty about giving effect to Rule 2.33A as set out above even where the material that is required to be removed neither “derives from anything that the court has declared to be invalid or ineffective, or to have been done without the authority of the company” (section 1096(1)(a)) nor is material that “a court declares to be factually inaccurate, or to be derived from something that is factually inaccurate, or forged” (section 1096(1)(b)).

[61]In the present case, Mr Margolin did not submit that the Applicant had no power to comply with paragraph 3 of the Order, and I have already held that in light of the Order the Applicant ceased to be under a duty to keep the Proposals on the register. I therefore consider that the Applicant is able to give effect to paragraph 3 of the Order by exercising his power to remove material from the register pursuant to section 1094(1) of the 2006 Act. Subject always to any further submissions as to whether the present case falls within Rule 2.33A on the facts, I also consider that this is what the Applicant ought to do, either in compliance with the Order, or because not to do so is contrary to public law principles.

[62]Accordingly, I consider that the above is sufficient to dispose of the present application. If that analysis is correct, the Respondents do not require paragraphs 4 and 7 of the

[63]However, in light of Mr Margolin’s other submissions, Ms Clarke was (understandably) not content to rely upon Rule 2.33A alone. In addition, Mr Margolin expressly asked for the rulings of the court on all his points. I will therefore consider their further arguments.

Paragraph 4 of the Order and section 1074 of the CA 2006

[64]Three issues arise under this heading:(i) the meaning of the first requirement contained in section 1074(2) of the CA 2006, that material “(a) is not necessary in order to comply with an obligation under any enactment”;

(ii) the meaning of the second requirement contained in section 1074(2), that material “(b) is not specifically authorised to be delivered to the registrar”;

(iii) whether paragraph 3 of the Order had the effect of rendering the disputed material “unnecessary material” within the meaning of section 1074 (if it was not otherwise “unnecessary material”).

[65]I do not understand it to be in issue that, if determination of these issues produces the result that the Proposals contain “unnecessary material”, then that material could not readily be separated from the rest of that document, so that the document is treated as not meeting the requirements for proper delivery in accordance with section 1074(4).

[66]“Unnecessary material” was defined in clause 728(2) of the Company Law Reform Bill in the same terms as in section 1074(2) of the 2006 Act. The Explanatory Notes stated in relation to clause 728:

“1311. This clause provides for cases where a delivered document contains unnecessary material (i.e. material for which there was no legal requirement)…”

It is unclear whether this explanation was intended to reflect clause 728(2)(a) (“not necessary in order to comply with an obligation under any enactment”) alone, or clause 728(2)(b) (“not specifically authorised to be delivered to the registrar”) as well. On the one hand, the phrase “legal requirement” is more apt to refer to clause 728(2)(a) alone. On the other, the explanation appears to have been intended to refer to the entire clause. On either view, I consider that this explanation supports what I would in any event hold to be the meaning of section 1074(2)(a), namely that it relates to legal requirements alone.

[67]Accordingly, I consider that the issue of whether the requirement in section 1074(2)(a) is made out falls to be determined on an entirely objective basis, by reference to legislation, and that the Applicant’s perception of whether or not material “is necessary in order to comply with an obligation under any enactment” has nothing to do with that issue.

[68]I also consider that determination of this issue does not have to be made at the time of delivery. If a document that is delivered to the Applicant contains material that “is not necessary in order to comply with an obligation under any enactment”, the requirement in section 1074(2)(a) will be satisfied albeit that this only becomes apparent at a later date.

[69]No doubt, in practice, it will be easier in some cases than in others for the Applicant to tell whether the requirement is met. Further, if the Applicant is unable to determine whether it is met – for example, because the document contains information which is usually found in full statutory accounts, and it is not apparent to the Applicant that the company in question is only required to deliver abbreviated statutory accounts – that may result in the document being registered even though, if the Applicant was able to make that determination, it would be treated as not meeting the requirements for proper delivery (pursuant to section 1074(4)) or he would choose to exercise the power to register it with the omission of the unnecessary material (pursuant to section 1074(5)(a)).

[70]However, these considerations do not lead to any different conclusion as to the correct interpretation of section 1074(2)(a). I make three observations in this context:(i) First, the consequence of including unnecessary material that cannot readily be separated from the rest of the document is that the document is treated as not meeting the requirements for proper delivery (see section 1074(4)). Further, in the case of a statement required to be served under Paragraph 49 that could have the effect that the administrator is guilty of a criminal offence (see Paragraph 49(7)). Accordingly, there are strong incentives for the sender of a document to avoid falling foul of this provision. This gives it teeth notwithstanding the fact that it may not be straightforward for the Applicant to detect “unnecessary material”.

(ii) Second, where unnecessary material can readily be separated from the rest of the document, it is reasonable to suppose that it will more easily be discernible by the Applicant, who then has power to omit it (see section 1074(5)(a)). In these circumstances, also, the provision would not appear to be lacking in effect.

(iii) Third, even where the document contains “unnecessary material” that can readily be separated from the rest of the document, the Applicant is not obliged to omit that material, but may instead register the document as delivered (see section 1074(5)(b)). This lends support to the view that section 1074 may be designed to cater primarily for the more egregious instances where extraneous material is included in a document delivered to the Applicant. It is not aimed at ensuring that in no circumstances is “unnecessary material” placed on the register.

[71]Turning to the requirement in section 1074(2)(b), in my judgment the expression “not specifically authorised to be delivered to the registrar” refers to what is not specifically authorised by legislation rather than what is not specifically authorised by a person. My reasons for reaching this conclusion are as follows:(i) Section 1072(2) states that “A document that is not properly delivered is treated for the purposes of the provision requiring or authorising it to be delivered as not having been delivered …” It appears from this that there are provisions which authorise documents to be delivered. Accordingly, section 1074(2)(b) will not lack content if it is interpreted as referring to authorisation in legislation.

(ii) The phrase “specifically authorised” also seems to me more apt to refer to authorisation by legislation than authorisation by a person. In the latter context, the familiar concepts include authority that is express, implied, actual, apparent or ostensible, but not, so far as I am aware, authority that is “specific”.

(iii) I agree with Mr Margolin that section 1074(2)(b) does not refer to legislation, and so does not spell out that what is meant is material that is not specifically authorised to be delivered to the Applicant by legislation. However, I also agree with Ms Clarke that, reading section 1074(2)(b) and section 1074(2)(a) together, it produces greater coherence if both are interpreted as relating to legislation.

(iv) I also agree with Ms Clarke that to interpret section 1074(2)(b) as referring to what is “not specifically authorised” by a person would be problematic, and in all likelihood unworkable, from the point of view of the Applicant. This is especially so because I accept Mr Margolin’s submission that, for this purpose, authorisation requires to be tested at the time that the document is delivered to the Applicant. If interpreted in that way, it is unclear how the Applicant could be expected to know whether or not the requisite authority existed. As against that, if the requisite authority depends on legislation, its existence is more readily ascertainable.

(v) If the Explanatory Note to clause 728 was intended to refer to clause 728(2)(b) as well as clause 728(2)(a), that would also support this interpretation.

[72]Mr Margolin submitted that to interpret section 1074 as meaning that anything that is not required or authorised by legislation to be included in a document is “unnecessary material” would produce a surprising result. I disagree. I consider that it would be more surprising if the content of “unnecessary material” depended on the extent to which a person had been “specifically authorised” to include that material in documents.

[73]Mr Margolin also submitted that to interpret section 1074(b) as referring to what is not specifically authorised by legislation means that it adds nothing to section 1074(a). I do not agree with this either. Section 1074(a) refers to the requirements of legislation, whereas section 1074(b) refers to what is authorised by legislation, which is different.

[74]Turning to the third point identified above, in my judgment whether or not paragraph 3 of the Order had the effect of rendering the disputed material “unnecessary material” within the meaning of section 1074(2) depends on the following matters:(i) Whether the inclusion of the disputed material in the Proposals was otherwise both (1) “not necessary in order to comply with an obligation under any enactment” and (2) “not specifically authorised (by legislation) to be delivered to the registrar”. If, prior to the making of the Order, the disputed material satisfied both those criteria in any event, then it was at all material times “unnecessary material” within the meaning of section 1074(2), regardless of the Order.

(ii) On the other hand, if, prior to the making of the Order, the disputed material was either (1) “necessary in order to comply with an obligation under any enactment” or (2) “specifically authorised (by legislation) to be delivered to the registrar”, then it was not “unnecessary material” at the time the Proposals were delivered to the Applicant. In those circumstances, the effect of the Order is of importance.

(iii) If the disputed material was not “unnecessary material” before the Order was made because the disputed material was “necessary in order to comply with an obligation under any enactment”, and that obligation ceased to apply as a result of the Order, I have no difficulty in concluding that the Order had the effect of rendering the disputed material “unnecessary material”.

(iv) If the disputed material was not “unnecessary material” before the Order was made because the disputed material was “specifically authorised (by legislation) to be delivered to the registrar”, it is, in my judgment, less obvious that the Order had the effect of rendering the disputed material “unnecessary material”. This is because the effect of the Order on what is authorised by legislation seems to me less clear than its effect on what is required by legislation. On balance, however, I consider that the better view is that the Order had the effect of rendering the disputed material “unnecessary material” in these circumstances also. In short, what is authorised by legislation is subject to a court order under Rule 2.33A.

[75]In summary, therefore, I consider that the Proposals contained “unnecessary material” within the meaning of section 1074(2) of the CA 2006. Moreover, although this is not clear to me from either the Respondents’ evidence or Ms Clarke’s submissions, I consider that the better view in light of the submissions made to date must be that this was not the position at all times, but only became so when the Order was made. My reasoning in this regard is that, unless the disputed materials were required to be included in the Paragraph 49 statement pursuant to Rule 2.33(2)(h) and (j) they would not fall within the ambit of Rule 2.33A, and so could not properly form the subject of an order under that Rule. However, Mr Margolin has not submitted that paragraph 3 of the Order ought not to have been made for this reason. As a matter of logic, therefore, on the submissions that have been made to date, the declaration in paragraph 4 of the Order is in appropriate form.

Paragraph 7 of the Order and section 1076 of the CA 2006

[76]In Re Calmex Ltd

[1989] 1 All ER 485

a winding-up order had been made against a company in error as a result of confusion between similarly named companies. The company that had ostensibly been wound up had not even been served with the petition. Nevertheless, the winding-up order had been forwarded to the Registrar and entered on the Registrar’s records relating to the company in accordance with section 130(1) of the IA 1986. Hoffmann J held that the proceedings and the winding-up order were a complete nullity. Dealing with the question of whether an order could be made for the removal of the winding-up order from the Registrar’s records, he said (at 488 g-j):

“Finally, counsel for the registrar submitted that the court had no jurisdiction to tell the registrar to remove documents from the register. I would be surprised if a company had no remedy against the registrar if he chose to include in the file a document which was prejudicial to the company and which he had no statutory duty to keep. And I have held that, on the true construction of s. 130(1) of the 1986 Act, the registrar has no duty to retain entered in his records a winding-up order which the court has declared to be a nullity. I suspect that the remedy would be by way of judicial review, but counsel for the registrar said that the registrar did not wish to take any point on the procedure by which the matter has been brought before the court, but contended that even by way of judicial review there was no jurisdiction. In my judgment the court does in principle have jurisdiction according to ordinary public law principles to control the way in which the registrar carries out his statutory duties, subject to any specific exclusions of that jurisdiction or the evidence on which it could be founded as in R v Registrar of Companies ex parte Central Bank of India [1986] QB 1114.”

[77]In Igroup Ltd v Ocwen

[2004] 1 WLR 451

, prescribed forms containing particulars of charges created and released by a number of companies had been sent to the Registrar of Companies and placed on the register. The forms contained personal information concerning the customers of the companies, some of which was not required by the forms. Due to concerns that the companies’ obligations of confidentiality to their customers had been breached, the group’s holding company sought an order for removal or replacement of some of these materials under section 404 of the Companies Act 1985 or the inherent jurisdiction of the court. The application was successfully opposed by the Registrar, on the ground that the court had no jurisdiction to make the order sought.

[78]Having rejected the claimant’s arguments under section 404 of the Companies Act 1985, Lightman J said with regard to the argument based on the court’s inherent jurisdiction:

“[27] In the alternative the claimant contends that, if section 404 does not give the court jurisdiction to order rectification of the forms and their schedules, the court has an inherent jurisdiction to order such rectification. This submission is unmaintainable, for in Exeter Trust Ltd v Screenways Ltd [1991] BCLC 888, the Court of Appeal expressly held that the existence of the limited statutory jurisdiction to order rectification under section 404 was wholly inconsistent with any suggestion that the court has any inherent power of rectification. [28] The claimant seeks to escape from the decision in the Exeter Trust case by submitting that In re Calmex Ltd [1989] 1 All ER 485 is authority for the proposition that the court has an inherent jurisdiction to order the registrar to rectify documents held by the registrar; that the Exeter Trust case [1991] BCLC 888 only decided that section 404 was a statutory fetter upon the exercise of that inherent jurisdiction in relation to the Register of Charges; and that the Court of Appeal in the Exeter Trust case referred to the Calmex case [1989] 1 All ER 485 with approval. Neither of the first two propositions is correct. The Calmex case merely established (if ever authority were required for the proposition) that the court has a supervisory jurisdiction over the registrar and can in judicial review proceedings make orders enforcing the performance by the registrar of the registrar’s public duties … [31] The Calmex case [1989] 1 All ER 485 was a case dealing with the question of whether the registrar should retain in the registrar’s records a particular document (namely the winding up order) which was a nullity. It was not a case like the present dealing with whether it might be permissible to order the registrar to rectify or alter a document held by the registrar. Hoffmann J held that the registrar had no statutory duty to keep such a nullity and therefore should not do so. It was not a case like the present which is concerned with the question of how the registrar should deal with valid documents, namely the forms and schedules, that had been duly delivered in accordance with the relevant legislation and properly relied upon by the registrar in the discharge of the registrar’s statutory functions and which the registrar is under a statutory duty to retain as part of the registrar’s records available for public inspection. [32] In a word, Hoffmann J held in the Calmex case that the registrar had a statutory duty to remove from the registrar’s records the nullity and the court in exercise of its supervisory jurisdiction would enforce that duty. In the present case, far from there being any public duty to rectify, the registrar is under a public duty to retain the forms and schedules in their present form. There are no grounds alleged or shown for invoking the court’s jurisdiction by way of judicial review. The Calmex case [1989] 1 All ER 485 accordingly affords no support for the proposition that the court has inherent jurisdiction to make the order sought.”

[79]In Re a Company (No. 007466 of 2003)

[2004] 1 WLR 1357

, a company had included in the notes to its annual accounts filed with the Registrar of Companies reference to an offer pursuant to CPR Part 36 made by the claimants in legal proceedings against the company. At the request of the claimants, the company made an application to file revised accounts, omitting that reference. The company accepted that, since the accounts complied with the requirements of the Companies Act 1985, it had no right to the order sought. However, it contended that the court could make the order under its inherent supervisory jurisdiction in relation to the Registrar. The application was successfully opposed by the Registrar on the ground that the court had no such jurisdiction.

[80]Mr Peter Leaver QC (sitting as a Deputy

Judge of the Chancery Division) said as follows:

“[33] In my judgment, there is a further, fundamental and insuperable difficulty in the path of this application. As I have said earlier in this judgment, limited liability companies are creatures of statute, and their existence and conduct is regulated by statute. The court has had to consider submissions that there is an inherent jurisdiction to regulate companies’ affairs in relation to a number of specific provisions of the legislation affecting companies. [34] In Exeter Trust Ltd v Screenways Ltd [1991] BCLC 888, the Court of Appeal was considering the question of the effect of section 401(2)(b) of the 1985 Act on a charge which was properly registered out of time, but where the register had been subsequently altered to delete the charge. It was held that the section made the certificate issued by the registrar conclusive evidence that the charge had been validly registered, and that the subsequent removal of the charge from the register did not affect the validity of the original registration. It was accepted in that case that there was no power under section 404(2) of the 1985 Act to delete the registration, but it was submitted that the court had an inherent power to the same effect. Nourse LJ [gave] a judgment with which Stuart-Smith LJ and Sir Roger Ormrod agreed … [35] … In my judgment, Nourse LJ was making the general point that the fact that the 1985 Act contained a limited provision to permit rectification was inconsistent with the existence of an inherent jurisdiction. The fact that the certificate was expressly stated to be conclusive evidence was also inconsistent with the existence of such a jurisdiction … [40] As I understand Hoffmann J’s judgment, he is not recognising the existence of some general and unlimited inherent jurisdiction to supervise the registrar, but simply the jurisdiction, which is to be exercised “according to ordinary public law principles”, to require the registrar to perform his (or her) statutory duties so as not, in that case, to permit the wrong that had been perpetrated on a company to continue. Hoffmann J decided either (and, in my judgment, it matters not which formulation is adopted) that the registrar had no statutory duty to retain on the register an order which was a nullity, and that she should not do so, or that the registrar was under a statutory duty to remove a nullity from the register, and should, if necessary, be ordered to do so by the court in the exercise of its supervisory jurisdiction to ensure that there was compliance with statutory duties. [41] The Calmex case is not, in my judgment, authority for the proposition that there is an inherent, supervisory jurisdiction to require or permit the rectification of any document or record that contains an error or some extraneous material, but which is otherwise filed in compliance with a statutory duty. In other words, the Calmex case is not authority for the proposition that a document or record that contains an error or some extraneous or superfluous material becomes, by that inclusion, a nullity and ceases to be properly filed, so that the registrar has no statutory duty to retain it on the record or that she is under a statutory duty to remove it … [46] In the result, therefore, the position is that I have not been referred to, and have not found, any authority for the proposition that there is a general, inherent supervisory jurisdiction in the court in relation to the performance by the registrar of her duties, nor, in my judgment, is there such a jurisdiction. At most, there is a jurisdiction to require the registrar to comply with her statutory duties (see the Calmex case), but that is not the jurisdiction which the company seeks to enforce in the present case. The company accepts that the registrar has complied with her statutory duty in relation to the filed accounts, but seeks, in a similar way as did the claimant in the Igroup case [2004] 1 WLR 451, the removal of extraneous or superfluous material. It does not seem to me to make a significant difference to the application that in the present case the extraneous or superfluous material is contained in the body of the filed document whereas in the Igroup case the material was contained in schedules annexed to the filed document. In each case there has been a proper filing and a proper performance by the registrar of her statutory duties.”

[81]In my judgment, the following propositions can be extracted from these authorities:(i) The court has no general, inherent supervisory jurisdiction in relation to the Applicant’s performance of his duties.

(ii) The court has jurisdiction in accordance with ordinary public law principles to control the way in which the Applicant carries out his statutory duties, subject to any specific exclusions of that jurisdiction or the evidence on which it could be founded, so as (for example) to prevent a wrong that has been perpetrated on a company as a result of it having been wound up in error from being continued.

(iii) Conversely, the court has no such jurisdiction in respect of valid documents which have been duly delivered to the Applicant in accordance with the relevant legislation and which are properly relied upon by the Applicant in the discharge of the Applicant’s statutory functions and which the Applicant is under a statutory duty to retain as part of his records available for public inspection.

[82]In my view, however, these cases do not provide a definitive answer as to whether and in what circumstances the court has jurisdiction to make an order against the Applicant where that is necessary and appropriate to protect the rights or interests of a third party. In particular, I consider that the language of proposition (iii) above (which I have derived from the judgment of Lightman J in the Igroup case) raises questions as to when documents are “properly relied upon” by the Applicant or are subject to a statutory duty.

[83]One situation in which these issues might arise is where it is contended that there is a conflict between the performance of the Applicant’s functions and Convention rights.

[84]The point can be illustrated by reference to the Green Corns case. It was not suggested in that case that the statutory accounts sent by the company to the Applicant and lawfully placed by the Applicant on the register contained information as to the addresses of properties owned by the company which it used to provide care to troubled children. However, they might have done. If so, the Art 8 rights engaged would, at least potentially, be of a high order of importance. If the company (or the children) contended that the retention of that information on the register jeopardised those rights, and the Applicant responded that the court should not interfere with the lawful performance of his functions in receiving the accounts and placing them on the register, there would be such a conflict. In that event, factors like those mentioned by Tugendhat J at [63] would be of relevance:

“The conjunction of information as to two or more of these matters, namely an individual’s address, the fact that that person is a child, and the fact that that child has a troubled history of mental health, sexual life and involvement in the commission of crime, will inevitably be regarded as a highly sensitive combination to which the court is very likely to accord some form of protection, subject to other considerations.”

[85]Such an argument was raised in the Igroup case, but was rejected on the facts. Lightman J held that Art 8 was not engaged, or that, if it was, the interference in that case satisfied the essential requirements of being prescribed by law, pursuing a legitimate aim, being necessary in a democratic society for protection of that aim, and being proportionate to the end pursued (see, for example, R v Shayler

[2003] 1 AC 247

[86]However, I do not read the judgment of Lightman J as suggesting that, even where an interference with Art 8 rights is involved, the court nevertheless cannot or should not intervene. Lightman J first dealt with, and rejected, arguments to the effect that the retention on the register of the information in issue in that case involved breaches of duties of confidence owed by the claimant and its subsidiaries to customers (see [22]) or breaches of the provisions of the Data Protection Act 1998 (see [23]). He continued:

“[24] The third suggested possible breach is by the registrar of section 6 of the Human Rights Act 1998 which provides that it is unlawful for a public authority to act in a way which is incompatible with rights under the Convention for the Protection of Human Rights and Fundamental Freedoms as scheduled to the 1998 Act. The relevant Convention right is article 8(1) which provides that everyone has the right to respect for his private and family life, his home and his correspondence. Article 8(2) provides an exception where the interference is necessary in the interests of the economic well-being of the country … The information is a form of a statement of the accounts between the defendant companies and their customers. I cannot think that disclosure of the information for proper business purposes and in particular in pursuit of an obligation to register a charge can engage article 8(1). But in any event any interference with that right is surely justified as in accordance with law, necessary in the interests of the economic well-being of the country (the maintenance of an accurate and complete record of filings at Companies House) and proportionate … I have considered whether it is significant for present purposes that the forms and schedules open to inspection in the case are more informative than they might have been. I have reached the conclusion that it is not significant … [25] Accordingly there appears to me to be no substance in the suggestion that the disclosure or consequent public availability of the information constitutes any form of wrongdoing by the defendant companies, still less the registrar …”

[87]Where a Convention right is involved, it will be unlawful for a public authority (such as the Applicant) to act in a way which is incompatible with that right unless(1) as a result of one or more provisions of primary legislation, the authority could not have acted differently (section 6(2)(a) of the HRA) or

(2) in a case where one or more provisions of, or made under, primary legislation which cannot be read or given effect in a way which is compatible with Convention rights, the authority was acting so as to give effect to or enforce those provisions (section 6(2)(b)).

[88]In practice, it is likely that any conflict between the Applicant’s statutory duties and such rights can be resolved in such a way as to avoid placing the Applicant in breach of his duty under section 6 of the HRA not to act incompatibly with such rights by applying the interpretative obligation under section 3(1). If that is impossible in the case of a provision of primary legislation, a declaration of incompatibility may follow (see section 4).

[89]In Ghaidan Lord Steyn said at [50]:

“What is necessary, however, is to emphasise that interpretation under section 3(1) is the prime remedial remedy and that resort to section 4 must always be an exceptional course. In practical effect there is a strong rebuttable presumption in favour of an interpretation consistent with Convention rights.”

[90]Accordingly, I consider that the performance of the Applicant’s functions is susceptible to the jurisdiction of the court for the purposes of giving effect to Convention rights.

[91]Even so, it may still be right to say that the jurisdiction falls to be exercised “in accordance with ordinary public law principles”. This is on the basis that, in addition to relying on traditional grounds, it also possible for a claimant to seek to challenge the act of a public authority on the grounds that the act is incompatible with the Convention.

[92]Using the language of Lightman J, where the Applicant’s dealings with a document are incompatible with a Convention right, for it to be “properly relied upon” by the Applicant in the discharge of his statutory functions or for him to be “under a statutory duty to retain [it] as part of his records available for public inspection” would be surprising results.

[93]In my view, however, that is not necessarily the limit of the court’s jurisdiction over the Applicant. I respectfully agree with what Peter Leaver QC said by way of postscript to his judgment in Re a Company (No. 007466 of 2003)

[2004] 1 WLR 1357

“[58] This judgment is confined to the facts giving rise to the claim, and is simply a judgment as to the rights of the parties to this litigation. I would not wish anything that I have said to be given any wider import. It would be easy to envisage factual situations, not far distant from the facts of this case, in which wider and different considerations might apply. Let me postulate a case in which a company (Company X) comes into possession of another company’s (Company Y) confidential information or trade secrets, and wrongfully publishes that information or those trade secrets in its filed accounts, which otherwise comply with the 1985 Act and give a true and fair view. The inclusion of the confidential information or the trade secrets by Company X is unlawful. Company Y applies for an injunction to restrain the publication, and to recover all offending copies, and joins the registrar to that application. I do not doubt that in such a case the court would wish to give effective relief to Company Y, but to do so would necessarily involve either ordering the registrar to permit the removal of the offending part of the accounts, or to permit the replacement of the accounts by new accounts which did not contain the offending passage. Other examples could be given, such as the inclusion of defamatory material in the accounts or report, but I do not think it necessary, or helpful, to multiply examples in this judgment. [59] I mention these points because it does seem to me that, while I am in no doubt that there is no inherent jurisdiction to permit the revision of the filed accounts in the present case, situations might arise in which the registrar’s statutory duty might come into conflict with a third party’s common law or statutory rights. [60] It may be that the solution to such problems would be found in an application of public law principles, but, as Hoffmann J said in the Calmex case [1989] 1 All ER 485, 487: “It is impossible to eliminate mistakes in searching official records or injustices caused by applying generalisations to exceptional cases… The question here is whether anything further can be done which is consistent with the registrar’s statutory duties and whether the court has power to order the registrar to do it.” [61] Or it may be that the solution in such a case would be for proceedings to be instituted against both the offending party and the registrar for an injunction to restrain the continued publication of the offending material, and for the use of reasonable endeavours to recall such material. Clearly, proceedings of that nature would involve the assertion of a specific right against the registrar, and would not involve the exercise by the court of an inherent, supervisory jurisdiction.”

[94]I am reinforced in taking this view by two considerations. First, the boundary between Convention rights and other rights is not necessarily clear or immutable. Thus, depending on the facts, the exception for “the protection of reputation” recognised in Art 10(2) may be a societal interest or may form part of a person’s Art 8 rights (see Re An Application by Guardian News and Media Ltd

[2010] 2 AC 697

, Lord Rodger at [37]-[42]). Second, the courts do not necessarily adopt any discernibly different approach when balancing the Art 10 right against the societal interest of “preventing the disclosure of information received in confidence” that is recognised by Art 10(2) than would be adopted when balancing Art 10 against Art 8 (see Cream Holdings Ltd v Banerjee

[2005] 1 AC 253

). Arts 8 and 10, so far as material, provide as follows:

“Article 8 - Right to respect for private and family life 1. Everyone has the right to respect for his private and family life, his home and his correspondence. 2. There shall be no interference by a public authority with the exercise of this right except such as is in accordance with the law and is necessary in a democratic society in the interests of national security, public safety or the economic well-being of the country, for the prevention of disorder or crime, for the protection of health or morals, or for the protection of the rights and freedoms of others. Article 10 - Freedom of expression 1. Everyone has the right to freedom of expression. This right shall include freedom to hold opinions and to receive and impart information and ideas without interference by public authority and regardless of frontiers .... 2. The exercise of these freedoms, since it carries with it duties and responsibilities, may be subject to such formalities, conditions, restrictions or penalties as are prescribed by law and are necessary in a democratic society, in the interests of national security, territorial integrity or public safety, for the prevention of disorder or crime, for the protection of health or morals, for the protection of the reputation or rights of others, for preventing the disclosure of information received in confidence, or for maintaining the authority and impartiality of the judiciary.”

Article 10 - Freedom of expression

[95]In some cases in which a conflict arises between the performance of the Applicant’s functions and the non-Convention rights of a third party it may be right for the court to conclude that, once the Applicant has notice of the matters in issue, his actions are amenable to challenge on traditional public law grounds if he does not exercise the power contained in section 1094(1) to “remove from the register anything that there was power, but no duty, to include”.

[96]Also, it may be possible to rely upon express provisions in the legislation. For example, truth is a defence to a claim for defamation (see section 2(1) of the Defamation Act 2013). Accordingly, as there will be no ground for complaint if the allegations are true or substantially true, a case involving defamatory material may be capable of being brought within the express provision requiring the removal of factually inaccurate material (section 1095(1)), or it may be possible to obtain a declaration of factual inaccuracy and to then rely on the Applicant’s obligation to rectify the register that is contained in section 1096. Where material is both defamatory and untrue, it seems in any event unlikely that there would be any public interest in placing or keeping the material on the register, or that the Applicant would be under a statutory duty to place it or keep it on the register.

[97]However, especially where the point does not require to be determined, I consider that it would be unwise to suggest that, no matter how great the harm to a third party, and no matter how modest the steps that the Applicant may be required to take, there can never be any circumstances in which he can be made amenable to the jurisdiction of the court unless either traditional public law grounds or express provisions can be relied upon.

[98]Incidentally, where confidential or private information is concerned, I would not accept Mr Margolin’s suggestion that the only proper claimant is the person to whom the obligation of confidence is owed. Leaving aside cases in which companies or institutions can be proper claimants in respect of the rights of those entrusted to their care (see, for example, the Green Corns case and Ashworth Hospital Authority v MGN

[2002] 1 WLR 2033

), I note that in the Igroup case the claimant’s “real concern” was not for itself or the defendant companies but “for the customers, and in particular to mitigate the consequences of the disclosure already made” (see [5]). Yet Lightman J did not suggest that the claim was ill founded for this reason. In my judgment, he was right not to do so.

[99]No arguments were addressed to me to the effect that it would open the floodgates, or would place intolerable administrative burdens on the Applicant, to reach conclusions such as I have reached above. However, I have not ignored those issues. The Applicant is subject to section 6 of the HRA in any event. And in Calmex Hoffmann J, who had much more experience of these matters than I do, said at 488f: “Cases like the present are likely to be infrequent and I think that the administrative burdens placed on the registrar are outweighed by the prejudice which might otherwise be caused to the companies”.

[100]In the words of Peter Leaver QC, I do not consider that it is necessary, or helpful, to attempt any further discussion in a case in which these points do not fall to be determined.

[101]Turning back to the facts of the present case, I have held that Rule 2.33A provides a basis for ordering the relief sought by the Respondents, and that an order made under that Rule is or ought to be all that they require to enable them to achieve the result they seek, namely the replacement of the Proposals with a revised Paragraph 49 statement that omits the disputed materials.

[102]If, contrary to the above, something more is required to achieve that result, I consider that the court does have jurisdiction, which it would be appropriate to exercise if necessary to give effect to an order that has been properly made by the court under Rule 2.33A in the circumstances of the present case, to require the Applicant to exercise the power contained in section 1076 of the CA 2006 to accept a replacement for a document previously delivered that both(1) did not comply with the requirements for proper delivery and

(2) contained unnecessary material (within the meaning of section 1074).

[103]In this regard, Mr Margolin observed that, in accordance with section 1074(2) “A replacement document must not be accepted unless the registrar is satisfied … that it complies with the requirements for proper delivery …” One point on this provision is that, if the replacement Paragraph 49 statement contains “unnecessary material” and that material cannot readily be separated from the rest of the statement, that document is treated as not meeting the requirements for proper delivery (see section 1074(4)).

[104]I accept that this is so. In the result, it is for the Applicant to satisfy himself as to these matters. If he is satisfied, he should accept the replacement document. If he is not, then he should not accept it. Further, I consider the court cannot or should not order the Applicant to accept a document that does not comply with the requirements for proper delivery.

[105]I do not consider that these points affect the substance of whether, if that is needed to give effect to the order made under Rule 2.33A, the court has jurisdiction to make, and ought to make, an order requiring the Applicant to exercise the power contained in section 1076. However, it may mean that the wording of paragraph 7 of the Order requires to be modified, to make clear that it is not intended to order contravention of section 1074(4).

[106]If those conclusions are wrong, I do not consider that Ms Clarke can get home on her fall-back argument that if an order requiring the Applicant to use his power to accept the revised Paragraph 49 statement under section 1076 of the CA 2006 is needed to give effect to the order made under Rule 2.33A, and even if the court has no jurisdiction to make an order requiring the Applicant to exercise the power contained in section 1076, the Applicant was in any event obliged to accept that document on delivery under section 1080 of the CA 2006. If the other aspects of my reasoning are incorrect, the placing of the Proposals on the register is not disturbed, and it seems to me that it would be a recipe for confusion to hold that the Applicant is obliged to accept another statement as well.

Conclusion

[107]For all these reasons, and subject to any further submissions as to whether the present case falls within Rule 2.33A on the facts, the application will be dismissed.

[108]I invite Counsel to agree a form of order in light of this judgment. In the event that any matters remain in issue, I will hear submissions on them when judgment is handed down.

Order

paragraph 3 of the Order, together with paragraphs 5 and 6, provides all that they need.

The Registrar of Companies v Swarbrick & Ors (Administrators of Gardenprime Ltd) [2014] EWHC 1466 (Ch)

Factual background

The Order

Paragraphs 1 and 2 of the Order and derogations from open justice

Legislative framework

The decision of the Deputy Registrar

Applicant’s submissions

Respondents’ submissions

Applicant’s further submissions

Paragraph 3 of the Order and Rules 2.33 and 2.33A

Paragraph 4 of the Order and section 1074 of the CA 2006

Paragraph 7 of the Order and section 1076 of the CA 2006

Judge of the Chancery Division) said as follows:

Article 10 - Freedom of expression

Conclusion

Order

Cited in 3 later judgments